The year 2025 has seen the resurgence of a major economic flashpoint—a full-scale trade war led by the United States, impacting every corner of the global economy. With skyrocketing tariffs, shaken supply chains, and shifting diplomatic alignments, the conflict is no longer a bilateral issue.
Let’s dive into the depth of the issue, understand both sides, and prepare for a powerful GD round with strong facts, data, and sectoral insights.
The trade war began when the United States imposed aggressive tariffs—as high as 145% on Chinese imports. This policy move aimed to reduce the U.S. trade deficit, push back against intellectual property violations, and revive domestic manufacturing. In retaliation, China levied up to 125% tariffs on U.S. goods.
Other countries like Mexico, the EU, and India have also responded by restructuring trade routes, increasing local production, and aligning diplomatically against unilateral U.S. trade actions.
| Point of View | Arguments in Favour of USA's Trade Actions | Arguments Against USA's Trade Actions |
| Economic Independence | Protects domestic industries from unfair foreign competition | Hurts American businesses dependent on global supply chains |
| Job Creation | Aims to bring back manufacturing jobs to the U.S. | Short-term job gains, but automation remains a bigger threat |
| Trade Deficit | Reduces reliance on imports and shrinks trade deficit | Trade deficit has complex causes beyond just imports |
| National Security | Reduces dependence on geopolitical rivals like China | Could trigger diplomatic rifts with allies and weaken global alliances |
| Innovation Push | Encourages self-reliance in technology and semiconductors | Innovation thrives better in open, collaborative ecosystems |
| Leverage | Tariffs used as a tool for diplomatic pressure | Long-term pressure may backfire with retaliatory policies |
| Reshoring Supply Chains | Motivates companies to move production back to the U.S. | Increases production costs, impacting consumers and competitiveness |
| Short-Term Gains | U.S. treasury benefits from import taxes | Consumers bear the brunt with higher prices and inflation |
| Global Leadership | Asserts U.S. dominance in rewriting trade rules | Risks alienating traditional trade partners and losing influence |
The trade war may aim to make America great again in trade terms, but the domestic economic consequences are hard to ignore:
Check out – IIM Placements | CMAT Previous year Papers
The U.S. might be at the center, but the tremors are being felt worldwide:
China isn't backing down. Instead, it's navigating with precision and diplomacy:
MBA Colleges – Top 50 MBA Colleges in India | Top MBA Colleges in Jaipur
Let’s understand how specific industries are taking the hit:
Giants like Walmart and Target are seeing higher procurement costs, leading to price hikes and reduced margins.
Clean energy initiatives are especially vulnerable due to tariff-induced supply disruptions and rising input costs.
The U.S. tech sector is under stress due to delayed imports of essential chips from Asia and strained collaborations.
Final GD Takeaways
If this topic comes up in your GD round, here’s how to stand out:
The 2025 trade war is more than a political move—it's a recalibration of global economics. Whether you're for or against it, one thing is clear: its ripple effect is too loud to ignore. Prepare your GD arguments with facts, strike a balance, and showcase both economic foresight and geopolitical awareness.